Sterling Capital closes $1bn third fund(2)

US mid-market firm Sterling Capital has nearly doubled the size of its previous fund with a ‘quick, easy’ capital raise.

Northbrook, Illinois-headquartered Sterling Capital Partners has closed a $1 billion fund, following approximately six months of marketing.

“It was a pretty quick, easy process,” said Shannon Zoller, Sterling’s vice president of business development.

The fund’s mix of 70-some limited partners – the majority of which are American and consist of fund of funds, pension funds, endowments, and foundations – included roughly a dozen new investors, three of whom resulted from Sterling’s long-standing relationship with European placement agent James Miller, of Somerset Capital.

Sterling utilises a placement agent “only in a very limited manner”, Zoeller said.

Sterling Capital Partners III will follow the same investment strategy employed in previous funds, investing between $15 million and $100 million in companies “across high-growth industries, including education, healthcare services, direct marketing, business services, financial services, and specialty manufacturing and distribution”, Sterling said in a statement.

Proskauer Rose provided fund formation legal counsel.

Sterling was established in 1983 and has offices in Northbrook, Illinois and Baltimore, Maryland. Its second fund closed in June 2005 on $547 million, while its first fund closed in September 2002 on $317 million.

The mid-market firm is part of a $3.8 billion bid for Laureate Education, a club deal being led by Kohlberg Kravis Roberts.